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The 33-year-old Harden has a $35.6 million player option for 2023-24. The Rockets have $45 million in cap space, including the $20.9 million non-guaranteed contract of Eric Gordon.
Houston is the second-youngest in the NBA, with a record of 9-23 this season (which is third-worst in the league). That means they're positioned to get one of the top picks in the 2023 NBA Draft, which is expected to be a strong class headlined by Victor Wembanyama and Scoot Henderson.
In his second season with the 76ers, Harden is averaging 21.4 points, 6.6 rebounds and 10.9 assists while shooting 36.4% from three-point range.
Just hours before the trade deadline last season, Philadelphia acquired Harden in a blockbuster deal with Brooklyn; the Nets got Ben Simmons, Seth Curry, Andre Drummond and two first-round picks in return.